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Know of a good video deinterlacer?

Anyone here with experience in video-making? I'm looking for a good deinterlacer. The video I've recorded are encoded in H.264/MPEG-4. I've tried using Avidemux's deinterlacing options (all dozen of them) to no success, it's useless.

If there is absolutely one thing I am hating right now is this horrible "shadow" or ghosting effect that you see on these screens. Look at Jill and the zombie.

Is this interlacing? What can I possibly do about that? Help would be appreciated.

That could be a product of deinterlacing gone wrong (wrong frame-order being merged)

However, it could also be an issue with telecyne/framerate up-/down conversion at work too (depending on the formats of the source material and what/how it's captured with and all that jazz)

Could you tell me briefly what the phrases that I bolded mean, please? Also, if you say the reason for that ghosting is caused by something in-between the recording... it couldn't be the device itself could it?

I bought this AVerMedia AVerTV HD DVR MTVHDDVRR card a couple weeks ago, and so far it does nearly everything right except the aforementioned issue I'm having now. It comes with no mention of auto-deinterlacing on the settings. I use the dongle included to record in S-Video, H.264 codec, in the .mp4 format (I've tried with AVI as well, and I get the same issue), Entropy mode: CAVLC, Level: Automatic (I don't even know what this means), at video size 640x480.

Another detail I'd like to add is my current recording setup. I have my Sega Saturn hooked up to a VCR via S-Video, with cables outputting from the VCR to the dongle. Here are photos, if anyone wants some other idea:

EDIT: I didn't see your post earlier, bot. If that's suppose to be really good, I'd give it a try. But those instructions do look extensively intimidating.

If you're gonna do a li'l bit of proper video filtering (and custom configs); time to get used to making some AVIsynth scripts ;D

(Also, chances are you'll just re-cycle most of your script for anything and everything recorded with your device, unless you change image source completely. Like jumping between actual recordings of live gameplay and a VHS capture of gameplay, etc.)